New CIPO pilot project on registrar-initiated cancellation proceedings for non-use

New Rules around the cancellation of Canadian trade marks represent a significant change for UK businesses managing rights in Canada.

In this article, Catherine Bergeron from Canada-based law firm, Robic, and Ben Travers from UK-based Foot Anstey, explore the issues, what they mean, and the steps UK businesses should take.

What is it?

At the beginning of January 2025, the Canadian Intellectual Property Office (CIPO) launched a pilot project aimed at providing insight into how many registered trademarks on the Canadian trademark register are no longer in use.

During Phase 1 of the pilot project, the Registrar will issue monthly batches of cancellation proceedings for non-use (pursuant to section 45 of the Trademarks Act) against randomly selected registrations, requiring the owners of registered trademarks that have been on the register for over three years, to submit evidence of trademark use or, where applicable, justification for non-use based on special circumstances. Once a statistically significant number of cancellation proceedings has been reached, as a Phase 2, CIPO will organize consultations to gather opinions on various aspects of the Registrar-initiated cancellation proceedings, to decide whether this pilot project should be continued, and if so, whether some adjustments need to be considered.

Why might this catch UK businesses out?

The new rules are significantly different to those UK businesses are used to dealing with in the UK or EU.

In the UK, trade marks can be registered where the applicant is using the mark or has a genuine intention to use the mark in trade. This means that the mark can be registered even in cases where there has been no use.

If a mark owner does not use a mark for a consecutive period of 5 years or more, the mark can become vulnerable to challenge.

UK businesses are used to working within this 5-year time scale and will now need to diarise to check that there has been use in Canada within 3, not 5 years.

In the UK, non-use typically becomes an issue when a third party challenges the validity of a mark, which they may only do if they have an interest in the mark (e.g. if it is being used against them in an opposition). This can in turn influence negotiations on oppositions and infringement proceedings. The new system in Canada changes this, meaning that UK businesses may find themselves having to prove evidence of use, even where there is no underlying enforcement action, and this is something they are not used to doing.

What does this mean for the owners of selected registered trademarks?

The cancellation notices will be sent to the address of record of the registered owner, with copy to the registered owner’s recorded trademark agent in Canada, if any. If no Canadian agent is appointed to a trademark on the register, the notice will only be sent to the owner of the registration directly. 

The deadline to respond to a cancellation notice is 3 months from the date of the Registrar’s notice. A 2-month extension of time is available, if need be.

The owner of a selected trademark will have to furnish evidence of use of its trademark in Canada at any time during the 3 years preceding the date of the notice in respect of each of the goods and/or services covered by the registration. If the trademark has not been used within that period, and if applicable, the owner can show evidence of the last date at which the trademark was used in Canada, and the special circumstances (i.e. circumstances or reasons that are unusual, uncommon, or exceptional) justifying the absence of use of the mark since that date.

Evidence must be submitted to the Registrar by means of an affidavit or a statutory declaration (which will become public record). The type of evidence may vary on a case-by-case basis, including whether the evidence must show use of the trademark in association with goods or services, but, in all cases, it must contain sufficient facts, with supporting material, to allow the Registrar to establish that the trademark has been used in Canada, in the normal course of trade. The evidence may include, for example, a sample of invoices displaying the trademark, sales figures in Canada for the goods/services sold/performed under the registered trademark, photographs of packaging and labels, a sample of website and social media printouts, a sample of advertisements, catalogues distributed in Canada, etc.

Upon receipt of the evidence filed by the owner, the Registrar will examine the evidence and will form an opinion on the use of the trademark. If satisfied that use has been shown, the proceeding may be terminated. If the Registrar is not satisfied that the evidence clearly demonstrates use of the mark in association with the goods and/or services covered by the registration, the owner will be given the opportunity to file written submissions and attend a hearing. In the event that evidence of use is only shown for part of the goods/services covered by the registration, the registration may be partially cancelled.

Should trademark owners take proactive measures?

As a proactive way to deal with this new initiative from CIPO, it would be advisable to ensure that minimal trademark use is made in Canada. The burden of proof in such proceedings is low, and minimal sales in the ordinary course of trade in Canada will generally be considered sufficient evidence of use to maintain a registration in association with a given good/service.

That said, if a trademark has not been used at all in Canada for the past 3 years, its owner may consider filing a new application for this trademark. Although a new application could be for the same mark in association with the same goods/services as those designated in the existing registration, it would nonetheless be recommended to take the opportunity to file an application for an updated version of the mark, in the case of a design mark which may have evolved over time, in association with an updated statement of goods/services, if applicable.

Are there any specific steps UK Rights owners should take?

As ever, businesses should ensure that they have effective procedures in place to manage their trade mark rights.

This includes having an agent on the record, to ensure that key deadlines are not missed.

To help meet the short deadlines, it will also be important to keep a record of any evidence of trade so that this is on hand, should it need to be provided to the Registry.

For any questions regarding CIPO’s pilot project or for more specific advice on a cancellation action for non-use, please consult Catherine Bergeron, Principal, Lawyer and Trademark agent at ROBIC or Ben Travers, Head of IP at Foot Anstey.